The accompanying graphs show the production possibilities frontiers (PPFS) for Italy and India for their domestic production ofolives and tea. Without trade, assume that each country is consuming olives and tea at point a.Italy120Olives (millions of tons)6+2PPF0 10203040Tea (millions of tons)India121010Olives (millions of tons)60420aPPF10 20 30 40 50 60Tea (millions of tons) Which statement is true?There is not enough information to decidewhether each country is better off.Both countries are worse off with trade becauseeach now consumes below their PPF.Both countries are better off with trade becauseeach can now consume beyond their PPF.

Option a: This option is incorrect because"There is not enough information to decide whether each…

Answered: The accompanying graphs show the…

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter33: International Trade

Section: Chapter Questions

Problem 30P: In Japan, one worker can make 5 tons of rubber or 80 radios. In Malaysia, one worker can make 10...

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Brazil can produce 100 pounds of beef or 10 autos. In contrast the United States can produce 40 pounds of beef or 30 autos. Which country has the absolute advantage in beef? Which country has the absolute advantage in producing autos? What is the opportunity cost of producing one pound of beef In Brazil? What is the opportunity cost of producing one pound of beef in the United States?
In Germany it takes three workers to make one television and four workers to make one video camera. In Poland It takes six workers to make one television and 12 workers to make one video camera. Who has the absolute advantage in the production of televisions? Who has the absolute advantage in the production of video cameras? How can you tell? Calculate the opportunity cost of producing one additional television set in Germany and In Poland. (Your calculation may involve fractions, which Is tine.) Which country has a comparative advantage in the production of televisions? Calculate the opportunity cost of producing one video camera in Germany and in Poland. Which country has a comparative advantage in the production of video cameras? In this example, is absolute advantage the same as comparative advantage, or not? In what product should Germany specialize? In what product should Poland specialize?
The accompanying graphs show the production possibilities frontiers (PPFS) for Italy and India for their domestic production of olives and tea. Without trade, assume that each country is consuming olives and tea at point a. Use the information provided in the graphs to answer the following questions. Olives (millions of tons) Italy 12 10 8 60 2 a PPF 0 10 20 30 40 Tea (millions of tons) India 12 Olives (millions of tons) 4 6 Co 10 2 a 0 PPF 10 20 30 40 50 60 Tea (millions of tons)
30. If the Portuguese were to insist on consuming 90 bottles of wine, what does that imply for trade between these countries? There would be no trade. The Portuguese would be consuming beyond their production possibilities frontier. The English would benefit from producing their own wine. Both countries would benefit more. None of the above.
The accompanying graphs show the production possibilities frontiers (PPFS) for Italy and India for their domestic production of olives and tea. Without trade, assume that each country is consuming olives and tea at point a. Italy 12 0 Olives (millions of tons) 6 + 2 PPF 0 10 20 30 40 Tea (millions of tons) India 12 10 10 Olives (millions of tons) 60 4 2 0 a PPF 10 20 30 40 50 60 Tea (millions of tons)
The following diagrams show the production possibilities frontiers (PPFS) for Armenia and Azerbaijan and their production of milk and razor trade. Which of the following statements is true when the two countries begin trading in razors and milk? Razors 15 10 5 Armenia 10 15 Milk (gallons) O Armenia will not trade with Azerbaijan O Armenia will export milk to Azerbaijan and import razors from Azerbaijan. O Armenia will export razors to Azerbaijan and import milk from Azerbaijan O Armenia will import razors and milk from Azerbaijan.. Razors 15 10 10 5 Azerbaijan 10 15 5 Milk (gallons)
LENTILS (Millions of pounds) 80 70 8 60 50 40 30 20 10 + 0 0 PPF 10 Shenandoah 20 30 40 50 60 PEAS (Millions of pounds) 70 80 (?) LENTILS (Millions of pounds) 80 70 60 50 40 30 PPF 20 10 0 0 T 10 Denali 40 20 30 50 60 PEAS (Millions of pounds) 70 80 (?) Shenandoah has a comparative advantage in the production of , while Denali has a comparative advantage in the production of . Suppose that Shenandoah and Denali specialize in the production of the goods in which each has a comparative advantage. After specialization, the two countries can produce a total of peas. million pounds of lentils and million pounds of Suppose that Shenandoah and Denali agree to trade. Each country focuses its resources on producing only the good in which it has a comparative advantage. The countries decide to exchange 20 million pounds of peas for 20 million pounds of lentils. This ratio of goods is known as the price of trade between Shenandoah and Denali. The following graph shows the same PPF for Shenandoah…
Corn 60 60 80 O 120 United States 20 60 Peanuts Corn 60 Using the graph above, if Canada has a comparative advantage in corn, how much should they produce when they specialize in the production of corn? 20 Canada Peanuts
Suppose that in the United States, producing an aircraft takes 10,000 hours of labor and producing a shirttakes 2 hours of labor. In China, producing an aircrafttakes 40,000 hours of labor and producing a shirttakes 4 hours of labor. What will these nations trade?a. China will export aircraft, and the United Stateswill export shirts.b. China will export shirts, and the United States willexport aircraft.c. Both nations will export shirts.d. There are no gains from trade in this situation.
Suppose that in a day a worker in the United States can produce 10 bushels of corn or 2 shirts. In Russia a worker can produce 9 bushels of corn or 3 shirts in one day. Which of the following would benefit both the United States and Russia if trade occurred? 1 shirt for 6 bushels of corn -----1 shirt for 4 bushels of corn 1 shirt for 1 bushel of corn 1 shirt for 2 bushels of corn Im doing review for a class and I realize that 1 shirt and for bushels are the correct answer I am just confused on what formula would apply to figue this out
am. 118.
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